- NFT trading volume dropped 63% since December, hitting $498 million in February.
- AI dApps are now the fastest-growing web3 sector, with platforms like LOL and Evermoon surging in users.
- Crypto scams are on the rise, with AI deepfakes and social media fraud increasing investor risks.
NFTs have experienced a sharp downturn, with trading volumes dropping significantly in early 2024. While some collections like Pudgy Penguins have managed growth, the overall market remains weak, reflecting a cooling investor sentiment.
Meanwhile, AI-driven dApps are thriving, attracting millions of users. Web3 platforms focused on AI-generated content, such as Fractal Visions and Evermoon, have reported massive growth.
The Rise of AI dApps: Web3’s New Dominant Force
The decentralized finance (DeFi) sector is also struggling, with total value locked (TVL) dropping by $49 billion in February. Ethereum saw a major hit due to a decline in liquid staking, while Solana suffered the biggest loss at 33%, largely due to reduced activity on Raydium and Jupiter.
Despite the broader downturn, some networks are showing resilience. Berachain registered $5.05 billion in TVL, while Aptos managed to grow by 6%. This suggests that while the overall DeFi space is cooling, specific platforms with strong community backing continue to thrive.
Beyond financial losses, cryptocurrency scams are escalating, with fraudsters leveraging social media and AI technology to deceive investors. AI-generated content, deepfakes, and romance scams are becoming increasingly common, making it harder to distinguish between legitimate and fraudulent opportunities.
Authorities are warning investors to remain cautious, as AI-driven scams are expected to grow. The increasing sophistication of fraudulent schemes highlights the need for better regulatory oversight and user awareness in the crypto space.
As the web3 landscape evolves, AI dApps are outpacing traditional NFT and DeFi sectors. However, the rise of AI-driven scams poses new challenges, making investor vigilance more critical than ever.
“Technology is a double-edged sword. It can be used for good, but it can also be weaponized in ways we’ve never seen before.” — Leslie Van Buskirk, NASAA President
